Oprah Winfrey has avoided a long and potentially uncomfortable legal battle after settling out of court with the former headteacher of her charitable school, who accused the television superstar turned humanitarian of defamation.

Nomvuyo Mzamane, who initially ran the school in South Africa for girls from poor backgrounds, accused Winfrey of wrecking her reputation by holding a press conference at which she accused the headteacher of ignoring pupils' complaints that they were being sexually abused by another member of staff.

Winfrey had planned to defend herself on the grounds of free speech. The hearing was due to begin next Monday at a federal court in Philadelphia, and as the named defendant Winfrey would have had to attend every day. She had rearranged the recording schedule for her daily TV talk show, filmed in Chicago.

But lawyers for both sides have announced a deal under which Winfrey confirmed that "she did not intend the implications placed on her words by the plaintiff". For her part Mzamane accepted she had "no evidence that Ms Winfrey knowingly made a false statement about her". There was no information about any financial settlement.

A joint statement said: "The two parties met woman to woman without their lawyers and are happy that they could resolve this dispute peacefully to their mutual satisfaction."

The Oprah Winfrey Leadership Academy for Girls, based south of Johannesburg, opened amid much fanfare in January 2007. It was hit by scandal later that year when some pupils claimed they had been sexually abused. A dormitory matron, Tiny Virginia Makopo, has pleaded not guilty to 14 charges connected to the claims.

In November 2007 Winfrey, who spent more than £25m setting up the academically selective school and has spoken of suffering childhood sexual abuse herself, told a press conference that Mzamane had been fired, ignored students' complaints and had required them to be "fearful and silent".

Mzamane's lawsuit said: "Simply put, the only reasonable inference to be drawn from the press conference was that Ms Mzamane was let go because, at best, she disregarded claims of sexual abuse." The case was being heard in Philadelphia as the former headteacher was working at a private school in the US city when she filed the claim.

Court papers filed by Winfrey's lawyers alleged that Mzamane failed to hire nurses to work as dorm matrons for the 150 pupils, instead using untrained young woman from a local company. Winfrey's school now has more than 300 students.